Friday, May 1, 2009

Cruise Travel: North to Alaska

With the Alaska cruise season getting underway, it's a good time to share with you why this year might just be a better time to see America's last frontier than next year.

For 2010, three cruise lines have already announced scaled back Alaska fleets. Princess Cruises, Royal Caribbean Intl, and Norwegian Cruise Line are each pulling a ship from the region. Even for 2009, small ship cruise line Cruise West is sailing five ships instead of the eight they originally scheduled and they have not announced their 2010 itineraries yet. While not taking a ship out of the 2010 market entirely, Holland America Line has replaced one-week cruises with two-week cruises on one fo their ships, which means half the passengers on that particular ship will be visiting popular ports such as Juneau on a weekly basis. Not only will there be fewer ships, there will be fewer with one-way (north-bound or south-bound) itineraries scheduled, which translates into less people opting for pre- and post-cruise stays at lodges in the Denali area. Fewer tourists means fewer seasonal tourism jobs for Alaskans.

Why the cruising cut backs? Quite simply, the Alaska cruise market has become over saturated since 9/11/01, when Americans were reluctant to fly overseas and more cruise ships were deployed in Alaska. While that's been good news for passengers (lower fares to fill the ships), the cruise lines have taken a beating on their revenue yields. If that weren't bad enough, the state of Alaska has proven to not be a good business partner by raising the head tax for each passenger by $50 and dipping into cruise ships' onboard revenue streams with additional fees. Alaska also put in place environmental standards for wastewater treatment with which the cruise lines cannot currently comply--the technology simply doesn't exist to do so. The implementation of those requirements have been delayed until 2015, but are still being held over the cruise industry's head.

The people of Alaska may not have thought a $50 per person tax would be that big a deal when they voted to pass it, but to cruise passengers, the bottom line makes a huge difference between whether to book a cruise vacation to a particular region or not. With ships--and their passengers--sailing off to other, more tourism friendly areas worldwide, Alaskans may regret passing such onerous legislation aimed directly at the cruise industry. We're just saying, maybe it wasn't such a good idea after all.

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